Fifty years of the war on poverty – inequality is still the issue

January 2014 marks the fiftieth anniversary of the speech – the State of the Union address – by former US president Lyndon Johnson announcing the War on Poverty. This war involved a series of legislative reforms intended to resolve a rising national poverty rate in the United States. In 1964, the United States Congress passed an initiative of the Johnson administration, the Economic Opportunity Act. This established local Community Action Agencies, administered by the Federal government, to implement poverty reduction strategies in their local communities. Eliminating poverty, expanding educational opportunities, and tending to the needs of the elderly, disadvantaged and unemployed were objectives of these community action agencies.

The Social Security Act of 1965 created Medicare and Medicaid, two agencies that provided health insurance for the underprivileged, helping millions of elderly people and the disabled. The most well-known reforms that the Johnson administration enacted are the civil rights measures, granting the right to vote to millions of previously disenfranchised African Americans in the deeply segregated Southern states.

The Voting Rights Act of 1965 is the seminal measure of federal legislation that prohibits discrimination in voting on the basis of race. This act outlawed any measures that specifically discriminated against ethnic minorities from voting, and ensured that mass enfranchisement of the racially-excluded African American communities was enacted in the Southern states of the US. Federal authority thus overrode the segregationist local authorities in the southern states. Interestingly, in 2013, the United States Supreme Court struck down the main provision of the Voting Rights Act, Section 4 of the legislation that mandates Federal supervision of all electoral laws in individual states, thus eviscerating a significant piece of legislation that guaranteed the democratic right to vote for racial and ethnic minority groups.

There were many other socially redistributive policies adopted by the Johnson administration as part of the Great Society, implementing the war on poverty. Nutritional assistance programs for those in dire poverty, educational programs such as Head Start which provided comprehensive educational, nutritional and parent-guardian involvement in the early childhood education of children from low-income backgrounds, food stamp programs for those in dire need – these encompass just some of the major changes that Johnson introduced as part of the War on Poverty. While Kennedy initiated many of the policies that became known collectively as the Great Society, Johnson carried them through over conservative opposition.

The collective legislative reforms enacted as part of the War on Poverty have undoubtedly had enormous social benefits for millions of Americans. Without programs like food stamps, nutritional and educational assistance, the Job Corps, poverty would be immeasurably worse. Does this mean that the war on poverty is a resounding success after 50 years? No it is not.

Congresswoman Frederica Wilson, representing Florida’s 24th District, wrote in the Huffington Post that while the positive impacts of the social programs under the War on Poverty are still with us today, the Republican Party, the political representatives of the financial and industrial elite, have defunded many of these programs and have waged an unrelenting assault on all the socially redistributive measures of the 1960s. In fact, there is a war against the poverty-stricken, and an economic assault on the wages and conditions of the working class in order to transfer even more wealth to the highest echelons of the financial oligarchy.

In July 2013, CBS News reported that according to economic data made available to The Associated Press revealed that four out of five American adults will rely on welfare at some point in their lives, because they face poverty, unemployment and loss of income in deteriorating economic conditions. More people are pessimistic about job prospects for the future, and increasing job insecurity, along with the massive loss in secure, well-paying manufacturing jobs is contributing to this sense of heightened pessimism. Economic insecurity includes periodic bouts of unemployment, and the corresponding rise in levels of anxiety and stress that accompany such periods.

Let us not forget that Johnson’s war on poverty measures also included tax cuts for the wealthy. He advocated the ‘trickle down’ theory of economic rationalism, that is, by decreasing marginal and capital gains taxes on the large corporations, the latter will invest that money into productive activities, create jobs and thus wealth will ‘trickle down’ to the poorer segments of society. In 1964, at the urging of the Johnson administration, the US Congress passed the Revenue Act, also known as the Tax Reduction Act, which cut marginal and capital gains taxes. It had the support of both sides of American politics. So the Johnson administration was not anti-business, as the conservative side of politics would have us believe, but actually did its utmost to cater for the needs of big business.

The trickle down theorists omitted to mention that wealth, rather than being dispersed by the corporate class, tends to coagulate at the very top. Johnson was no friend of the working class – his policies, derived from the platform of the Democrat Party, never sought to challenge the fundamental structural inequalities of the American capitalist system. Johnson witnessed the increasing level of poverty in the US, reaching 22.4 percent in the late 1950s, the idle capacity of closed factories and the unemployed members of the workforce, and the great strides made by the USSR during the 1950s and early 1960s in developing their economy and educational resources, launching the first artificial satellite into space in the late 1950s, and the first person into outer space in 1961. In 1957, the American economy entered a recession, and while the economy recovered by 1961, the US was still growing more slowly than West Germany and Japan. The US economy began the 1960s with high unemployment, millions of idle workers, unused industrial capacity and a flow of gold and dollars out of the country. The Johnson administration launched measures to revive American capitalism domestically, while also escalating and intensifying American militarism abroad, namely in Vietnam.

The war on poverty and all its associated measures, tax cuts and social programs, were not only advocated by the Democrat Party, but were fully supported by the Republicans at the time. Bipartisan support for the war on poverty is an important point that is often overlooked in today’s more right-wing political climate of attacks on social security. Ferocious anti-socialist and extreme right-wing successor to Lyndon Johnson as president, Richard Nixon, not only embraced the war on poverty, but actually extended its application. Nixon advocated an increase in welfare payment, plus an automatic cost-of-living adjustment to social security payments to cater for inflation. Both these measures became law in 1972.

Nixon expanded the Supplemental Nutritional Assistance Program, commonly known as food stamps upon which millions of American families depend; provided supplemental security income (SSI) to the elderly and people with disabilities, and initiated a tax break for moderate income earners so they could keep a greater proportion of their earnings. All these measures were adopted by a Republican president who escalated the Vietnam war, expanded the US bombing campaign into neighbouring Cambodia, suppressed and spied upon anti-war protests domestically, and authorised covert assassinations and death squad operations in the south of Vietnam to stamp out the anti-colonial liberation movement there.

It is true that since the late 1970s, with the advent of the Thatcher-Reagan consensus on the primacy of ‘free market’ economics, there has been a sustained assault by the ruling class on social security by the conservative side of politics. The era of deregulation of financial markets, and the privatisation of public assets had begun. Government programs were viewed as bloated and wasteful. The economic campaign to widen the operation of the private sector was accompanied by an ideological campaign to demonise government-run services as inefficient hotbeds of nepotism, and people living on welfare as ‘scroungers’ avoiding personal responsibility to find work. There was no comparable denunciation of the real benefit claimant abusers, the corporations that rely on state subsidies, and who receive payouts on a massive scale until today.

Jobs and working conditions were under sustained attack by the financial oligarchy, and one of the targets of the American Republican political offensive was the war on poverty. However, the Republican effort at derailing the social security measures of the war on poverty have been enabled, and extended, by the Democrat Party. We have gone from a war on poverty, to a war on the poor. While more American politicians are discussing the issue of inequality, the debate is framed as a singular attack on the public purse as the allegedly worst offender for waste and inefficiency.

Randi Weingarten, the president of the American Federation of Teachers, discusses the effects of the war on the poor and the demonisation of the unemployed in her article. She correctly notes that the Republicans have led the attack on the working poor, and that unemployment is not the result of personal failings, but the result of an ever-shrinking number of jobs that pay a liveable wage.

However, she puts her political faith in the Democrats, a party that is ostensibly an opposition force, but which has done its utmost to implement policies that are not far removed from the right-wing neoliberal economic agenda. The Democrat party has also encouraged a climate of economic insecurity, which sees not just the unemployed struggling, but a significant section of the employed not earning nearly enough, finding themselves sinking into poverty. It is not just the manufacturing workers that are descending into penurious circumstances; adjunct professors are also facing temporary employment, with no health benefits, declining hours of work, and compose a new and growing proportion of the working poor.

Former US President, Democrat Bill Clinton fulfilled his 1992 campaign promise to ‘end welfare as we know it’ by passing the Personal Responsibility and Work Opportunity Act in 1996. This legislation reformed the entire basis of welfare in the United States, and introduced a workfare component to the disbursement of payments. Open-ended unemployment benefits were ended, and time limits introduced. The unemployed were now required to work for their payments, and this exerted downward pressure on the wages of the full-time employed. This kind of scheme was a centrepiece of the Republican party’s efforts to transform welfare – it took a Democrat president to do it.

Consider the 1996 “Personal Responsibility and Work Opportunity Act” (a more Orwellian title would be hard to conceive), the Clinton-era legislation that sought to gut welfare provision here in the US. The terms of this act should put us in mind of another act, passed in England nearly two centuries ago: the New Poor Law of 1834. The provisions of the New Poor Law are familiar to us, thanks to Charles Dickens’s depiction of its workings in Oliver Twist. When Noah Claypole famously sneers at little Oliver, calling him “Work’us” (“Workhouse”), he is implying, for 1838, precisely what we convey today when we speak disparagingly of “welfare queens.”

When a Democrat president enacts a law that was a cornerstone of the Republican Party’s platform in dealing with the poor, there is hardly a murmur of protest.

To quote Tony Judt further;

In the contemporary United States, at a time of growing unemployment, a jobless man or woman is not a full member of the community. In order to receive even the exiguous welfare payments available, they must first have sought and, where applicable, accepted employment at whatever wage is on offer, however low the pay and distasteful the work. Only then are they entitled to the consideration and assistance of their fellow citizens.

The implementation of the reasonable-sounding Personal Responsibility Act was the first step in undermining the conditions of stable employment and liveable wages for the majority of the working class. Poverty has become a permanent and expanding feature of the American capitalist system. More people are being pauperised, pushed down into the ranks of the working poor.

For the vast majority of people in the US, poverty will be an experience to endure for at least a portion of their lives. The myth of upward social mobility is being eroded, as increasing numbers of Americans rely on food stamps, welfare payments and charitable organisations to make ends meet. Working people, especially those on minimum wage, are unable to cope with an ever-increasing cost of living. No longer can a working person achieve the much-vaunted ‘American dream’ of a ‘middle class’ lifestyle. However, some people are doing very well out of this most recent economic crisis; as the Socialist Worker’s writer Gary Lapon explained:

The 400 richest Americans, with a total net worth of $1.7 trillion as of last year, were worth an average of $4.2 billion each, enough to support over 89,000 families of four at 200 percent of the poverty level for an entire year.

In the meantime, in major American cities, the numbers of homeless are increasing. In Chicago, where Obama’s close political adviser and friend Rahm Emanuel is mayor, the homeless shelters can barely cope with the demand, and those turned away were forced to stay riding on public transportation in order to keep warm. The public school system is breaking down, with dilapidated buildings housing ever-growing classes, the electricity and lighting systems are stretched to the limit, but Mayor Emanuel still found the time to do the important things, like go holidaying in Indonesia while the city’s residents shuddered in the freezing conditions.

The Obama administration is continuing the pro-business policies of his Democratic predecessors, announcing a new anti-poverty initiative – promise zones. Five impoverished communities are selected to be the targets of deregulatory measures, tax breaks for the corporations to invest in, and these communities will serve as cheap labour pools for capital investment. This deregulation and encouragement of business investment has its origins in the failed ‘trickle down’ theory of economic investment. Once again, rather than implement socially redistributive policies, a Democrat President is relying on the goodwill of the private sector with inducements that have failed to attract investment in the past. Writing in Jacobin online magazine, Sam Wetherell states that deregulatory-driven solutions to poverty reduction are more accurately called ‘Enterprise Solutions’. These areas are friendly to big capital, exempt from state oversight and regulation – including state taxation – this solution supposedly encourages private investment and jobs growth. The workforce is corresponding impoverished.

Benefiting already powerful market forces, Obama’s initiative of promise zones sounds very similar to the most extreme right-wing Republican economic freedom zones, allowing business to run rampant at the expense of health and safety standards, environmental concerns and working conditions. In November 2013, the Obama administration made the largest cuts to the food stamp programme it was first introduced in the 1960s. Long-term stagnation and recurring joblessness are the order of the day – so let us not expect the Obama regime to end this recession any time soon.

Barbara Ehrenreich, the American investigative journalist, democratic socialist and activist, raises an interesting point in her article about poverty and the minimum wage published in The Atlantic. One of the main charges by the financial oligarchy against welfare expenditure is that poverty is the fault of the poor; the irresponsible habits and spending of the poor is the reason for their penurious circumstances. Government intervention, it is argued, does nothing to alleviate poverty because the poor have made thoughtless and feckless lifestyle choices. Single mothers seem to attract the most criticism, being singled out as particularly wasteful and overly-dependent on welfare, scrounging off the system while the rest of us hard-working taxpayers foot the bill.

Ehrenreich addresses these charges in her article ‘It is Expensive to be Poor’. For people in poverty, it is not capricious lifestyle choices that are responsible, but the lack of decent paying, secure jobs. Low-paying and minimum wage jobs are a kind financial trap – they pay too little and are too insecure to help a person build up savings and move to a more secure area of employment. In fact, being on a minimum wage is a big incentive for a worker to be extremely frugal with their money, carefully monitoring their spending, making sure the essentials are paid and working according to a budget. As Ehrenreich explains;

I was also dismayed to find that in some ways, it is actually more expensive to be poor than not poor. If you can’t afford the first month’s rent and security deposit you need in order to rent an apartment, you may get stuck in an overpriced residential motel. If you don’t have a kitchen or even a refrigerator and microwave, you will find yourself falling back on convenience store food, which—in addition to its nutritional deficits—is also alarmingly overpriced. If you need a loan, as most poor people eventually do, you will end up paying an interest rate many times more than what a more affluent borrower would be charged. To be poor—especially with children to support and care for—is a perpetual high-wire act.

Being poor in today’s America is an expensive proposition. Ehrenreich concludes her article by stating that we need to revive a sense of collective responsibility to assist the poor, and not view them as irredeemable miscreants. Since the 2008 economic crisis, it is not just the manufacturing workers that have been downsized, but middle managers, technical workers, information technology specialists, lawyers and legal professionals – people that were once doing well but now face difficult circumstances. It is difficult to maintain the narrative of failing personal responsibility, blaming the victims for their poverty when the one percent is accumulating massive amounts of wealth at the expense of the ninety-nine percent.

Inequality is the major issue of our times, highlighted by the ongoing capitalist economic crisis. The Obama administration, while pay lip service to the issue of wealth redistribution, has actually presided over a transfer of income from the nation’s working class to the top one percent. Mike Treen, in a wide-ranging article on inequality published in Links online magazine, reports that in September 2013 95 percent of America’s income gains over the 2008-2013-period have accrued to the nation’s wealthiest one percent. Obama acknowledged that greater numbers of Americans are feeling frustrated with Washington in a speech he gave in December 2013. A few weeks later, 1.3 million unemployed people were cut off from receiving any benefits as part of a budget deal approved by both sides of the US Congress.

For poverty to be reduced, we must go beyond redistributive measures, important as they are, and address the structural inequities of the capitalist system itself. There is one politician who has done just that, but he was not an American. He became president of a country that is dwarfed by the United States economically and militarily. It has nothing like the mineral and labour power resources of the US, and has suffered horrendous levels of poverty for decades. He took power in a democratic election in 1999, and by the end of his presidency in early 2013, he not only consistently maintained and expanded his popularity, regularly winning elections, he set an example for other countries to follow in poverty reduction.

That politician was the socialist President of Venezuela, the late Hugo Chavez.

In an article published in Counterpunch in 2012 entitled ‘The Achievements of Hugo Chavez’, the writers explain how Chavez maintained his popularity with the electorate:

One of the main factors for the popularity of the Chávez Government and its landslide victory in this re-election results of October 2012, is the reduction of poverty, made possible because the government took back control of the national petroleum company PDVSA, and has used the abundant oil revenues, not for benefit of a small class of renters as previous governments had done, but to build needed infrastructure and invest in the social services that Venezuelans so sorely needed. During the last ten years, the government has increased social spending by 60.6%, a total of $772 billion.

Which other political leader of recent times can demonstrate the following achievement;

Before the Chavez government in 1998, 21% of the population was malnourished. Venezuela now has established a network of subsidized food distribution including grocery stores and supermarkets. While 90% of the food was imported in 1980, today this is less than 30%. Misión Agro-Venezuela has given out 454,238 credits to rural producers and 39,000 rural producers have received credit in 2012 alone. Five million Venezuelan receive free food, four million of them are children in schools and 6,000 food kitchens feed 900,000 people. The agrarian reform and policies to help agricultural producers have increased domestic food supply. The results of all these food security measures is that today malnourishment is only 5%, and child malnutrition which was 7.7% in 1990 today is at 2.9%. This is an impressive health achievement by any standards.

Venezuela now boasts the lowest inequality level in the South American region; reducing poverty from 70.8 percent in 1996 to 21 percent in 2010. Extreme poverty was 40 percent in 1996; it was 7.3 percent in 2010.

Spearheading massive social and political change, the Bolivarian Revolution achieved an enormous reduction in severe poverty that had afflicted millions for decades, blighting the lives and prospects of families and children in that country.

War on Poverty – Chavez showed the world how it is done. The Venezuelan revolution continues.